Broadcast consumer protection coalition launches

By Colin Mann

February 5, 2014

TVfreedom.org, a new coalition of US local broadcasters, community advocates, network television affiliate associations, multicast networks, manufacturers and other independent broadcaster-related organisations has been launched to help protect consumer interests, ensure emergency and weather related programming access, promote the value of broadcast-TV programming, and preserve a fair and free video marketplace.

“TVfreedom.org will tell the truth about the state of the video marketplace and call out the pay-TV industry’s inside-the-beltway gamesmanship designed solely to increase their record profits,” said Robert C. Kenny, director of public affairs for TVfreedom.org. “On behalf of consumers, we will publicly engage policymakers, lawmakers and advocacy groups to protect TV viewers from manufactured blackouts by Pay-TV providers and extra fees on their monthly bills.”

TVfreedom.org supports market-driven solutions and policies that create more choices and increased accessibility for consumers’ favourite TV programming. It also is calling for modernizing the nation’s communications laws to reflect the convergence of video services in the marketplace, while enabling innovation to continue to flourish. As part of its agenda, TVfreedom.org supports policies that provide consumers with refunds on their monthly pay-TV bills for programming blackouts; eliminate or reduce unnecessary and questionable fees that pay-TV providers tack onto monthly consumer bills (i.e., early termination fees and one-time charges for changes in service); and protect content providers from the use of their lawful content by others without fair compensation.

TVfreedom.org believes that the retransmission consent process enables local TV broadcast stations to continue providing their communities with vital information, including local news, as well as emergency alerts, severe weather updates, public health advisories and details on time-sensitive public safety-related incidents.

The Coalition supports greater transparency on customers’ monthly pay-TV bills, calling for disclosure of programming costs for ALL content, not simply the selective disclosure of only local and network broadcast-TV programming. “It is disingenuous on the part of some cable and satellite TV providers to single out the costs associated with retransmission consent fees paid to broadcasters when less popular cable programming represents a much higher percentage of the total bill charged to consumers each month,” Kenny said.

The coalition notes that recent times have seen Time Warner Cable, DirecTV and DISH, among other pay-TV providers, initiate an intense public relations campaign aimed at getting government assistance to bypass the existing system that, today, fairly compensates broadcasters. “Broadcasters produce the highest-rated content on television and provide a public service by reporting on natural disasters, extreme weather and other emergencies. These pay-TV providers have created a false political crisis and are seeking government intervention to gain an unfair advantage in the marketplace over broadcasters,” it claims.

TVfreedom.org believes that consumers would ultimately benefit from a system where cable and satellite TV providers fairly compensate all channels based on the ratings, popularity and quality of the programming that each channel provides to viewers. During the 2012-13 television season, 96 of the top 100 broadcast-TV programmes dominated the primetime programme rankings. The coalition says that for years, cable and satellite TV customers have been overpaying for lower-rated cable channels that they don’t want or watch. These cable channels are, in many cases, paid much more than broadcast channels, despite winning just a fraction of the viewership ratings.

According to publicly available data, the very same pay-TV companies which are responsible for initiating nearly 90 per cent of the retransmission disputes in America (DirecTV, Time Warner Cable and Dish Network) collectively amassed nearly $68 billion in total revenues from October 2012 through September 2013. “Certain Pay-TV providers are publicly presenting a false picture of the marketplace and calling for government intervention despite the fact that 99 per cent of all retransmission disputes are resolved nationwide without blackouts or service disruption to consumers. We urge pay-TV providers to negotiate in good faith with broadcasters on retransmission consent in all cases,” he concluded.

According to the coalition, key facts on the state of the video marketplace are:

From October 2012 – September 2013, DirecTV had revenues of $31.2 billion, Time Warner Cable had revenues of $22 billion and the Dish Network had revenues of $14.4 billion – resulting in a collective revenue total of nearly $68 billion annually for the three companies.

Since March 2009, Time Warner Cable, DirecTV and Dish Network stock values increased 378 per cent, 398 per cent and 197 per cent, respectively.

Unlike any other US consumer communication service, over the past 13 years, cable prices in particular have consistently risen annually at more than double the rate of inflation.

Since 2012, nearly 90 per cent of programming disputes involve only Time Warner Cable, DirecTV or Dish Network. Dish alone is responsible for over 50 per cent of these viewer service disruptions.

Today, 99 per cent of carriage-related disputes are resolved through good faith negotiations, without service disruption to consumers.

Retransmission consent fees are not the cause of rising pay-TV bills, barely amounting to 10 per cent of the basic pay-TV bill ($4 to $5 per month) for consumers.

Broadcast programme ratings far outpace programming offered by cable channels. In fact, during the 2012-13 television season, broadcast programming dominated the primetime programme rankings, accounting for 96 of the top 100 programmes.

In the coming weeks and months, the coalition will look to add to its charter membership and will work closely with consumer and community groups, as well as public safety and law enforcement organisations.